AutoNation board member Carlos Migoya named Miami city manager

February 22, 2010|By Charles Rabin

MIAMI — The Miami Herald

Carlos Migoya, a career banker who worked up and down the eastern seaboard, was introduced Monday as the man to take on Miami's widening financial woes. His priority as city manager: Helping Miami avert disaster.

Migoya, 59 and bearing a resemblance to actor Ben Kingsley, has spent the past two months at Mayor Tomás Regalado's side, studying the city's sliding revenues and skyrocketing pensions. With Manager Pete Hernandez resigning Friday, Migoya arrives at a near crisis time for Miami.

Though he wouldn't commit to a lengthy stay, Migoya said he won't leave until the city's finances are in order. He will forego a salary and benefits of more than $300,000 a year.

"This is a very complex and challenging situation," Migoya said at City Hall, vowing to evaluate every department and employee. "This is not a one year problem."

Commissioners are expected to approve his appointment Thursday. Migoya and Regalado said they only recently met through the mayor's son Tommy, who lives in the same apartment building as Migoya on Brickell Key.

Migoya has held key management posts at the old Southeast Bank and with First Union, which became Wachovia, holding jobs from New Jersey to Connecticut to North Carolina.

He sits on the board of AutoNation in Fort Lauderdale.

William Allen, a local banking fixture who directed Southeast Bank before it was taken over by federal regulators in the 1990s, hired Migoya in the mid 1970s and worked with him for 15 years.

"He's a zero tolerance manager who will refuse to be compromised in any way, by anybody," said Allen.

Migoya said his first order of business is to determine exactly where the city sits financially. Despite attending city meetings since December, Migoya said Monday while visiting The Miami Herald's editorial board that department budgets and revenues are in such disarray he hasn't been able to get a handle on them.

"What I've not seen is a whole bunch of urgency around the situation," he said.

Regalado said management dragged its feet on 131 promised layoffs and failed to move on canceling the living-wage ordinance for janitors at the city-owned Miami Riverside Center.

The ordinance issue, he said, has already cost Miami $1.6 million this budget year.

The mayor said he and Migoya will focus on the unions, whose worker-friendly contracts have helped strangle the city's purse strings. Those contracts had been approved by commissioners including Regalado.

"We are telling the unions that we will not be adversaries. We will clean our house first, but then we will go to them," said the mayor.

Migoya said he has no background dealing with unions, but that it's time to rein in contracts that have created a pension obligation expected to cost taxpayers more than $100 million at the end of this budget year.

He'll also confront a growing federal investigation into the city's finances launched by the U.S. Securities and Exchange Commission. Federal regulators have asked Miami to turn over all communications between several department heads regarding millions of dollars of questionable money transfers, and $250 million in bonds sold over the past four years.

Regalado said Miami is still gathering the information the SEC demanded in December. Since then, department heads including Hernandez, Chief Financial Officer Larry Spring and Budget Director Michael Boudreaux have been subpoenaed.

"The city cannot afford to have something of that magnitude hanging over its head," Migoya said, calling the SEC probe "one of the most important priorities."

Hernandez had spent three decades running departments at County Hall before then Mayor Manny Diaz named him to the city's top administrative post in 2006. Friday, he quit abruptly, saying it was time for someone else to take on "the upcoming challenges of next year's budget." Hernandez leaves with a severance of two months pay and benefits, or about $55,000, city officials say.

Just three months after closing a $118 million budget hole, commissioners learned revenues remain in such a freefall the finance director projected a new deficit of between $20 million and $45 million.

Add that to an expected shortfall of close to $30 million when the 2009 budget is officially closed out next month, and Miami is treading close to tapping deeply into its $88 million in reserves. The outlook is so dismal, Regalado has asked staff to compile a list from the city's 714 assets that could be sold to make ends meet.

Among the assets being considered for sale are parking garages and the city-owned Knight Center, which carries a $5.5 million yearly debt obligation.

Financial projections show the city falling below the reserve amount required in its Financial Integrity Ordinance. In that case, staff will have to forward a two-year plan to the commission to replenish the account, which Migoya said he intends to do.